Ordering and Carrying Costs Ottis, Inc., uses 773,500 plastic housing units each year in its...
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Accounting
Ordering and Carrying Costs
Ottis, Inc., uses 773,500 plastic housing units each year in its production of paper shredders. The cost of placing an order is $35. The cost of holding one unit of inventory for one year is $19. Currently, Ottis places 170 orders of 4,550 plastic housing units per year.
Required:
1. Compute the annual ordering cost.
$fill in the blank 1
2. Compute the annual carrying cost.
$fill in the blank 2
3. Compute the cost of Ottiss current inventory policy.
$fill in the blank 3
Is this the minimum cost?
YesNo
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